On Wednesday, September 25th, Eastern Time, the three major U.S. stock indices closed with mixed results, with the Nasdaq slightly higher and the Dow Jones Industrial Average and the S&P 500 Index turning negative after reaching new intraday highs. The market is focusing on the potential impact of Federal Reserve rate cuts and the U.S. presidential election on the stock market.
Micron Technology, the largest U.S. computer memory chip maker, saw its stock surge by more than 14% after hours due to unexpectedly strong sales and profit guidance.
The three major stock indices had mixed performances:
- The Dow Jones Industrial Average closed down by 293.47 points, a decrease of 0.70%, at 41,914.75 points.
- The Nasdaq Composite rose by 7.69 points, an increase of 0.04%, at 18,082.21 points.
- The S&P 500 Index fell by 10.67 points, a decrease of 0.19%, at 5,722.26 points.
Federal Reserve Governor Koolger stated that he strongly supports the Federal Reserve lowering interest rates by 50 basis points and would support further rate cuts in the future if inflation progresses as expected. Additionally, the Federal Reserve should continue to focus on reducing inflation while also turning its attention to the maximum employment goal.
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According to the FedWatch tool from CME Group, the market's expectation for the Federal Reserve to cut rates by another 50 basis points at the November meeting has risen to over 60%.
Goldman Sachs' Chief U.S. Equity Strategist, David Kostin, said that it is clear that U.S. stocks will continue to rise once the results of the U.S. presidential election are determined. He expects the S&P 500 Index to trade near 6,000 points a year from now. This implies that the S&P 500 Index will rise by about 5% from Tuesday's closing level, and the index has already accumulated an increase of about 20% this year.
Before the results of the U.S. election are announced, more and more companies are delaying significant investments. The latest financial professionals' Chief Financial Officer survey released on Wednesday by the Atlanta Fed, Richmond Fed, and Duke University's Fuqua School of Business shows that about 30% of companies have postponed, reduced, or canceled investment plans due to the uncertainty of the election results, which is higher than the 28% proportion in the previous quarter.Google Sues Microsoft
On September 25th local time, Google officially filed a complaint with the European Commission, accusing Microsoft of engaging in anti-competitive practices in the cloud computing market. Google stated that Microsoft locks in customers through its Azure cloud platform, giving it an advantage over competitors. Regulatory action is the only way to resolve the current situation.
Morgan Stanley analysts pointed out that the delivery cycle for the iPhone 16 is lower than that of the past three iPhone models. On the 11th day after pre-sales began, the delivery cycle for the iPhone 16 in the United States is 15 days, while the average delivery cycle for the iPhone 15 models at this time last year was 26 days, and all iPhone 14 models were 18 days.
U.S. Securities and Exchange Commission filings show that after nearly three months of selling off shares, NVIDIA CEO Huang Renxun completed his pre-arranged share sale plan and cashed out more than $700 million (approximately 4.922 billion yuan).
According to an executive share sale plan passed in mid-March this year, Huang Renxun plans to sell up to 6 million shares of NVIDIA before the end of the first quarter of 2025. Such transaction plans are classified as 10b5-1, which allows company insiders to trade company stocks in a predetermined manner.
The Wind U.S. TAMAMA Technology Index rose by 0.42%, with NVIDIA surging by more than 2% and Tesla by more than 1%. Facebook and Microsoft rose by less than 1%, while Apple, Amazon, Netflix, and Google fell slightly.
Boeing Company Warned
Berkshire Hathaway sold off Bank of America stocks on September 20th, 23rd, and 24th, 2024, in three consecutive trading days, cashing out about $863 million (6.057 billion yuan). After this sale, Berkshire Hathaway holds 10.5% of Bank of America's shares, approaching the regulatory threshold of 10%.
Bank stocks fell across the board, with Goldman Sachs, Citigroup, and Wells Fargo down more than 1%, while Morgan Stanley, JPMorgan Chase, and Bank of America fell slightly.
The Federal Aviation Administration (FAA) told Boeing that they would not allow them to increase the production of the 737 Max until they made extensive improvements and warned that this could affect their profitability.Airline stocks experienced mixed movements, with Delta Air Lines rising by 2%, United Airlines slightly increasing, Southwest Airlines falling by over 4%, Boeing declining by over 2%, and American Airlines slightly dipping.
Micron Technology soared by over 14% in after-hours trading.
Financial report data indicates that Micron Technology's adjusted earnings per share for the fourth fiscal quarter were $1.18, exceeding expectations of $1.12; revenue was $7.75 billion, surpassing the anticipated $7.66 billion.
Bolstered by robust demand for artificial intelligence (AI), Micron Technology has driven an increase in the production of data center DRAM products.
Micron Technology anticipates adjusted earnings per share for the first fiscal quarter to be between $1.66 and $1.82, which is higher than the analyst consensus of $1.52. The company expects adjusted revenue for the first fiscal quarter to be between $8.5 billion and $8.9 billion, while analysts were expecting only $8.32 billion. The expected adjusted gross margin for the first fiscal quarter is between 39.5% and 40.5%, compared to the analyst consensus of 37.6%.
Due to the financial guidance surpassing expectations, Micron Technology's stock price surged by over 14% in after-hours trading.